Purdue Pharma LP agreed to plead guilty to criminal charges over the handling of its addictive prescription opioid OxyContin, in a deal with United States prosecutors that effectively sidestepped paying billions of dollars in penalties and stopped short of criminally charging its executives or wealthy Sackler family owners.
In a far-reaching agreement unveiled on Wednesday, Purdue formally admitted to criminal conduct related to the distribution of its painkillers and agreed to pay $225m to resolve US Justice Department investigations. The Sacklers would also cede control of Purdue.
Prosecutors imposed significant penalties exceeding $8bn against Purdue, though the lion’s share will go largely unpaid.
Purdue agreed to pay $225m towards a $2bn criminal forfeiture, with the Justice Department foregoing the rest if the company completes a bankruptcy reorganization dissolving itself and shifting assets to a “public benefit company,” or similar entity that steers the unpaid portion to thousands of US communities suing it over the opioid crisis.
A $3.54bn criminal fine and $2.8bn civil penalty are likely to receive cents on the dollar as they compete with trillions of dollars of other claims from those communities and other creditors in Purdue’s bankruptcy proceedings, according to court documents and people familiar with the matter who spoke to Reuters news agency.
Wednesday’s announcement does not conclude the extensive litigation against Purdue, but it does represent a significant advance in the long legal march by states, cities and counties to compel the most prominent defendant in the opioid epidemic to help pay for the public health crisis that has resulted in the deaths of more than 450,000 Americans since 1999, according to the Centers for Disease Control and Prevention.
Members of the billionaire Sackler family who own Purdue agreed to pay a separate $225m civil penalty for allegedly causing false claims for OxyContin to be made to government healthcare programs such as Medicare, according to court records.
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